Non-Resident / Alien Tax Questions (US / Canada)

Discussion in 'Taxes and Accounting' started by Scorbles, Jan 27, 2008.

  1. Scorbles


    Hi All,

    A couple of quick questions for anyone with experience:

    I am Cdn resident about to move overseas (prob to tax haven) and trade for a living. I want to trade primarily the Cdn exchanges but the Cdn brokers generally do not accept accounts for non-residents (and definitely do not grant them margin). If I deal with a US broker but trade Cdn exchanges will I be paying US or Cdn withholding tax on my gains. I trade somewhat frequently (10-20 trades per day) and often close off positions the same day. I believe this would make me a trader (income instead of cap gains) in either jurisdiction. Does this distinction make a difference when I am looking at withholding taxes?

    Can anyone recommend a good US retail broker for trading on the Cdn exchanges? They must accept non-resident accounts but as I understand it, most US firms do. I prefer brokers that offer per-trade commission schedules with no limit on the number of shares.

    "As a general rule, Canada slaps a 25-per-cent tax on disbursements to foreigners — dividends, interest and royalties." As a short-term trader I not very interested in dividends etc. Is it possible that I will not be subject to any taxes as a Cdn non-resident trading from a tax haven?? (Wishful thinking!!).

    Thanks for any and all insight.